NEW DELHI: Office space inventory at peripheral locations such as Manesar, Greater Noida and the extended parts of NH-8 has lead to nearly one-third, or about 32%, of quality office space in Delhi NCR remaining vacant, according to property consultancy JLL India.

However, the picture isn't that bad if these locations are excluded.

Delhi NCR's office vacancy rate significantly drops to just 25% if Manesar, Greater Noida and the still-emerging Golf Course Extension Road are excluded from the calculations. However, the region loses a mere 11% from its total Grade A stock of 95 million square feet.

"These locations remain peripheral in terms of occupier traction, except for the most cost-discerning ones. These corridors with strata-titled buildings attract much lower interest from occupiers, and some are struggling to hold on to their older tenants," said Rohan Sharma, associate director – research & real estate Intelligence Service, JLL India.

The consultancy estimates the Grade A office vacancy level in Delhi NCR would further comes down to just around 20% if the ‘dead stock’ projects with strata-titled, poorly designed buildings in prime office corridors are eliminated.

This situation has also created significant project-level vacancies in even major office corridors such as the secondary business districts of Jasola and Saket in Delhi, and office corridors such as Sohna Road and Golf Course Extension Road in Gurgaon.

"Strata-titled, poorly-designed and remotely located buildings are low on occupiers’ priority lists, and are symbolic of developers’ over-exuberance leading to over-capacity," Sharma said.

The prime office corridor of DLF Cybercity in Gurgaon at oresent has just 5-8% vacancy rate, while quality projects across the office markets of Noida and Gurgaon are currently running at full capacity with limited vacancies.

JLL said the vacancy level can fall even further by another 100-150 bps if we factor in some structural vacancy in prominent projects which are currently under active discussion by occupiers and likely to find takers soon.

The average vacancy in commercial real estate stands at 15% as of the June quarter this year, according to JLL, with Bengaluru registering just 3% vacancy rate, an all-time low, against the top seven cities in the country.

Bengaluru is followed by other IT hubs like Pune and Hyderabad having vacancy levels of 6% and 9%, respectively. Chennai comes next at around 12%, Kolkata and Mumbai at around 19% vacancy levels each.